It appears that a great debate is forming around the opening up of conservation land. As always, I am neutral, I would have to look at it on a case by case basis. I trust property rights to keep things rolling along effectively, unless there is a significant social benefit associated with the non-mining of some specific land.

Anyway, given my willingness to open up the forum to debate, I think that this image sums up the anti-mining case quite succinctly:

Through a property-rights lense, I note that: 1. The property rights are initially held by the Crown as the land is public conservation land. Conservation land are ‘public common goods’. 2. That initial allocation does not change if a conservation area is mined. The miner never has full freehold title. The asset, and any liabilities, remain with the Crown, when mining ceases. For example, the Crown has ended up with a $NZ10 million liability for the Tui mine. (http://en.wikipedia.org/wiki/Tui_mine) 2. The Crown’s property rights are restricted by statutes such as the National Parks Act 1980 and the Conservation Act 1987 which provide generally that such public land is to be managed for conservation purposes . 3. However, Section 61 of the Crown Minerals Act 1991 (http://www.legislation.govt.nz/act/public/1991/0070/latest/DLM246714.html#DLM246714) provides the exception; a statutory access process for mining within conservation areas. 4. Section 61(2) provides the specific matters that the Minister (of Conservation) must consider. 5. Schedule 4 of the Crown Minerals Act 1991 prohibits mining access via the Section 61 to certain high value conservation areas. (http://www.legislation.govt.nz/act/public/1991/0070/latest/DLM247378.html#DLM247378)

So, the ‘property right’ to mine in a conservation is a privilege to be applied for not a right. And it is ‘prohibited’ from even a case-by-case assessment under S 61 of the Crown Minerals Act 1991 in some conservation areas by Schedule 4 of the Crown Minerals Act 1991. So Schedule 4 and Section 61 act as an ‘allocation plan’ for a restricted subset of property rights, the right or permission for a private company to mine, subject to conditions, within a conservation area.

But miners don’t need exclusive property rights to mine and will want to avoid ownership liabilities such as orphan mines like Tui mine. Also, case law, the Buller Electricity case (http://users.actrix.co.nz/simonjohnson/buller.html) says that the Minister of conservation cannot dispose of conservation areas for social or economic reasons.

So the Crown Minerals Act provides a Crown guarantee for mining Crown land, as well as providing a process that gets round the obvious inconsistence with ‘management for conservation purposes’ statutory objective.

National is proposing to change this ‘allocation plan’ by increasing the conservation areas allocated to ‘access-on-application’. This is a transfer of property rights from the public to private interests.

What you state National is suggesting doesn’t sound like providing property rights in the case with low social benefit. It sounds like giving individuals the capacity to use the land with the priviso that future ownership is uncertain – this sounds like a great way to get a suboptimal outcome.

The way to go would be to identify areas where the public interest is very low – and then sell them to the private sector …

Yes, in my view the status quo gives a suboptimal outcome. As does the proposal. Actually the future ownership is certain. The Crown retains it. The miner seems to be assymetrically better off in terms of what property rights are allocated. The miner ends up with the valuable private goods, the minerals, but escapes full responsibility for the long-term adverse effects by never assuming full ownership as the Crown retains ownership and therefore responsibility for the public ‘bads’ (such as polluted tailings dams). The conservationist argument on identifying “areas where the public interest is very low” would be to say that these areas are already identified – they are private land with no conservation status.